Can You Get a Personal Loan Against Your LIC Policy?

Your LIC Policy Can Fund You

A life policy may also be doubled, as a strong security against a secured loan.

In the process of availing a loan, the policy is transferred formally to the lender until full repayment is made.

Policy Assigned, Loan Granted

Loans are usually available in the case of endowment, whole life and money-back plans.

Not All Policies Qualify

Pure term insurance has no surrender value, hence can not be used as a loan.

Term Plans Don't Qualify

The minimum number of years that premiums have to be paid should be two, and then a loan on the policy is available.

Policy Must Be Active First

In-force policies: up to 90%; paid-up policies: up to 85% of surrender value.

Up to 90% of Surrender Value

IRDAI sets the framework; LIC fixes the rate, currently around 9–10% per annum.

Prices are controlled by regulators

The policy is usually valued against the loan, meaning that no credit check and long documentation are needed.

CIBIL Score Not Required

Any pending loan repayments can be subtracted from the ultimate maturity or claim benefit of the policy.

Policy Benefits May Reduce

Wrapping loans on life policies are fast cash, but will always focus on making repayments on time.

A Smart but Careful Choice

                     Disclaimer                        The information provided on this website is for general informational purposes only and should not be considered financial or legal advice. Please consult with a qualified financial advisor before making any decisions.